To all-
Anyone notice the following and the "rather interesting" investor???
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Digital Sound Corp. Closes Financing
December 19, 1997 6:10 PM EST
CARPINTERIA, Calif.--(BUSINESS WIRE)--Dec. 19, 1997--Digital Sound Corp. (Nasdaq:DGSD) Friday announced that it has closed a private placement of an aggregate of $20 million of the company's convertible securities at a price of 75 cents per share on an as-converted basis.
One of the investors is Microsoft Corp., which purchased an aggregate of $5 million of the securities. Affiliates of Oak Investment Partners also purchased an aggregate of $5 million of the securities.
In the offering, the company issued approximately 1.8 million shares of its Series B Convertible Preferred Stock at a price of $7.50 per share and convertible promissory notes in an aggregate principal amount of approximately $6.6 million. Each share of Series B Convertible Preferred Stock is convertible into 10 shares of the company's Common Stock.
The company also exchanged the 2,631,579 shares of the company's Series A Convertible Preferred Stock held by affiliates of Oak Investment Partners for 666,667 shares of its Series B Convertible Preferred Stock.
The convertible promissory notes will automatically convert into Series B Convertible Preferred Stock at a conversion price of $7.50 per share if the company's shareholders authorize a sufficient increase in the number of authorized shares of the underlying common stock at the annual shareholders meeting.
Upon consummation of this offering, the company has 58,198,262 shares of common stock outstanding or subject to issuance upon exercise or conversion of outstanding options, warrants or convertible securities. No purchaser in the private placement (except for Oak Investment Partners and its affiliates) holds more than 11.5 percent of such shares of common stock.
As previously announced, the company had been granted an exception by the National Association of Securities Dealers Inc. to issue the securities without prior shareholder approval.
In connection with these transactions, the company also announced that its board of directors has approved a 1-for-5 reverse stock split, subject to shareholder approval at the next shareholders meeting.
The company also announced it will take a one-time charge in the fourth quarter of 1997 of up to $1.5 million, principally for certain inventory and severance matters, among other items.
About Digital Sound
A leading supplier of network-based, communication-management solutions, Digital Sound gives people the freedom to manage voice, fax and e-mail messages anytime, anywhere, using a telephone, personal computer, fax, pager or Web browser.
Digital Sound's product line integrates messaging and speech technologies on an open-systems platform, giving its customers -- public network service providers -- a strategic advantage in a highly competitive marketplace.
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